Some Mich. Charities Say Tax Changes Hit Donations

LANSING (WWJ/AP) – Some charitable organizations in Michigan have reported a decline in donations following tax changes that eliminated state credits for financial gifts to food banks, homeless shelters and certain nonprofits.

Among the groups whose donations have declined are the Coalition on Temporary Shelter (COTS), the Detroit Rescue Mission, Gleaners Community Food Bank and Detroit Public Television, according to reports.

Donations to COTS were down 10 percent, or $45,000, between 2011 and 2012. In 2011, when Michigan had a 50 percent tax credit, COTS received 1,023 contributions between $200 and $400. Last year, when no credit was available, donors fell to 866.

That is “a significant sum of money for our agency,” said Trish Dewald, COTS chief development officer. “If you couple that decrease with the drop in state and federal dollars, as well as foundations tightening their belts, that is a very difficult climate for human service agencies.”

Republican Gov. Rick Snyder and the GOP-led Legislature made the changes to help balance the state’s budget. In 2011, about 234,000 Michigan taxpayers claimed $19.5 million in tax credits through donations to homeless shelters and food banks.

Snyder’s office said the tax credit elimination was part of a plan designed to create a fairer and simpler tax system, and make Michigan more economically competitive.

“The changes are already working as there are 156,000 more payroll jobs since January of 2011,” said Caleb Buhs, a Snyder spokesman. “In addition, the state’s budget has been stabilized, which has allowed for increased investments in education, public safety and economic development.”

The Food Bank Council of Michigan, which represents food banks across the state, said there has been an average drop of 29 percent in donations of $200 and a 47 percent decrease in donations of $400. Detroit Public Television also reported a drop from some categories.

Since they moved to Michigan from Oklahoma about 10 years ago, Michelle Kees and Toby Padfield gave $400 annually to a Michigan food bank. When making charitable contributions in 2012, they considered how the 2011 tax policy changes eliminated the tax breaks for donations to certain nonprofits.

The couple skipped the food bank to increase a donation for pediatric brain cancer research, because their oldest son, 7-year-old Andrew, had recovered from a brain tumor.

“I’m even embarrassed to say it,” said Kees, 40, of Livonia, a clinical psychologist at the University of Michigan. “When I became aware of the double-bang (Michigan) tax credit — how it helps them and helps me — we made sure to give to the food bank.”